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Midstate manufacturers eyeing worker shortage, automation projectsCPBJ Manufacturing Activity Index for Q1 gauges industry's future

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A dearth of skilled workers, rising health care costs and evolving technology are among the industry changes weighing on the minds of manufacturers in the midstate, according to answers submitted in the first edition of the CPBJ Manufacturing Activity Index.

The index is a quarterly measure of conditions and expectations in Central Pennsylvania’s manufacturing industry. It serves as a snapshot of confidence among manufacturers and an indicator of the local economy's future direction.

When asked for the most important factors affecting their businesses right now, respondents said:

  • "Not finding qualified mill workers to fill our open positions."
  • "Lack of skilled labor, terrible regulatory environment, lack of qualified salespeople, rising health care benefits, increased fuel expense."
  • "Off-shoring and push by customers to low-cost country manufacturing."
  • "Personal spending, import taxes, shrinking retail sales, growing internet selling, health care costs, staffing."
  • "A strong economy will result in good sales for us. The economic environment will be indicative of where we go in 2017."

Overall, most companies surveyed have seen and expect growth. About 74 percent said that in the last three months their pipeline of projects has increased, and about 76 percent anticipate continued growth over the next six months.

Responses were collected between Feb. 17 and March 6 from representatives of 61 manufacturing and related companies. Of the total, 89.7 percent were in manufacturing and 8.6 percent were in distribution. One company cited “other” and two did not answer.

Roughly three quarters came from Lancaster (30.5 percent) and York (45.8 percent) counties. The remainder came from Dauphin, Lebanon and other counties.

Slightly more than half (54.3 percent) had more than 100 employees. More than a quarter (28.8 percent) had between 25 and 99 employees. Another 16.9 percent had 24 employees or less. Two companies did not indicate their size.

See the rest of the survey's results in the slideshow below.

The next survey will take place in May, with results to be published in June. If you are interested in taking part, email lists@cpbj.com.

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Dan Fink March 30, 2017 9:38 am

I think this notion of a skills gap is overstated. Not that aren't some manufacturers that might be having trouble filling a few positions. But as an industry, there isn't widespread evidence that there are hundreds of thousands of jobs out there just waiting to be filled if only workers were better trained.

Five Thirty Eight took a look at this idea about a year ago.
https://fivethirtyeight.com/features/dont-blame-a-skills-gap-for-lack-of-hiring-in-manufacturing/

Their conclusion: "The cause is more fundamental than that: Due mostly to automation, U.S. factories now produce more than ever with fewer workers. Thatís a trend no job-training program will reverse."

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